During Prime Minister Turnbull’s visit to Washington in February, U.S. Trade Representative Robert Lighthizer and Australian Minister for Trade, Tourism and Investment Steven Ciobo issued a joint statement agreeing to “intensify cooperation to support the growth of digital trade between our countries, ensure an open, free and secure Internet, and advocate the liberalization and facilitation of global digital trade.” It’s great to see a visible commitment from the U.S. and Australia to promoting digital trade and to reduce barriers.
The digital trade relationship between the U.S. and Australia is strong. Australian businesses rely on U.S. services to reach international markets, illustrated by Australian service imports for telecommunications, computer, and information services from the United States. In 2016, these imports amounted to $1.046 billion AUD, or over $806 million USD. However, with only 13.2% growth from 2011-2016 there is clearly an opportunity to expand the market. The relationship is reciprocal. In 2017, 25.9% of Australian startups generated revenue from export sales, and the United States was the largest overseas customer base for these exports.
Future growth of Australian innovation will depend on the ability of companies to access and export to international markets. Predictability is especially critical when companies seek to invest in new markets. For Internet companies of all sizes, this includes predictable international liability rules, and, especially for e-commerce services, digital customs regimes that adequately reflect the consumer expectations in the digital age.
However, domestic legislation stands in the way of Australia’s ascent to the next innovation hub of the Asia-Pacific. There are pending regulatory items that pose a barrier to entry for global technology and Internet companies looking to invest in the Australian market, as well as impeding innovation in the Australian startup community.